300,000 iPads sold on day of debut

Posted: Mon 10:41 AM, Apr 05, 2010

By DEBORAH YAOAP Business Writer Apple Inc. said Monday that it sold more than 300,000 iPads onits opening day, meeting the expectations of some analysts whileunderscoring the challenges the company still faces marketing themuch-anticipated device beyond early adopters. The figures, which included pre-orders that were picked up ordelivered Saturday, were hardly exceptional despite weeks of hypeabout the revolutionary nature of a new class of device that fallssomewhere between the phone and computer. In a research note earlier Monday, Piper Jaffray analyst GeneMunster had doubled his initial forecast of first-day sales to600,000 to 700,000, saying that "lines were longer than expectedand supply was also better than expected." But the actual numbersannounced by Apple were closer to his original estimates. Still, first-day U.S. sales of the iPad exceeded those of theoriginal iPhone in 2007, he said. He expects Apple to sell 1.3million iPads in the current quarter compared with the 1.1 millionfor the iPhone in its first full quarter. Sales of the iPhone have since picked up, and Apple sold 8.7million worldwide in its latest quarter. The latest model, the 3GS,sold a million in just three days when it went on sale last summer,initially in the U.S. and seven other countries. Saturday's iPadlaunch was in the U.S. only. Eager customers stood in long lines across the country Saturdayto be among the first owners of a device they were expecting to bea game-changer, even if they weren't quite sure yet how. Once the initial iPad excitement settles, Apple may have to workharder to persuade a broader swath of people to buy one. Manycompanies have tried to sell tablet computers before, but none hascaught on with mainstream consumers. Apple essentially must convince people who already have smartphones, laptops, e-book readers, set-top boxes and home broadbandconnections that they need another device that serves many of thesame purposes. The iPad now on sale, at prices starting at $499, connects tothe Internet wirelessly through Wi-Fi. Some people may be waitingfor a pricier version that can access the Internet over cellulardata connections. That version should be out later this month. The iPad will also go on sale in other countries starting in afew weeks, though some Europeans made a trip to New Yorkspecifically to buy one Saturday. Kaufman Bros. analyst Shaw Wu, who had estimated that Apple sold250,000 to 300,000 over the weekend, said the device has thepotential to be another big hit in Apple's arsenal of products downthe line with lower prices and better software for the device. "When the iPhone was first launched, it was also somewhat of adisappointment. ... But as the iPhone got more refined, with moreapps, better software, not to mention better prices ... then youstarted to see the volumes really take off," Wu said. "We thinkthe iPad is similar." He said checks of the supplier channel shows that Apple notifiedmanufacturers to get ready for possibly 10 million units to beshipped, up from 5 million previously. Broadpoint Amtech analyst Brian Marshall said the iPad's weekendsales met his expectations, especially with many stores closed forEaster. He said the iPad's Saturday sales of more than 300,000units is about 60 percent of his weekend forecast of 525,000 - adecent showing for a product that has garnered mixed reviews. "We're off to a fantastic start," Marshall said. But he said the device won't be overshadowing the iPhone, whosesales he expects to top $20 billion this year, eight times hisforecast of $2.5 billion for the iPad. "It's really all about the iPhone, but the iPad will generatefantastic sales this year," he said. Apple, which is based in Cupertino, Calif., also said that iPadowners downloaded more than a million applications and more than250,000 electronic books on Saturday. Shares of Apple were up $1.40, or 0.6 percent, to $237.37 inmidday trading Monday.

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